Central Bank warns public on pyramid schemes, crypto-currency scam

The Central Bank has cautioned the public on the emergence and operation of investment scam activities in the country. The bank said that operators often masquerade as locally registered businesses or registered abroad and are accessible via online platforms. In a communique signed by the bank’s Governor, John Rwangombwa, the regulator warned that the scams take forms of pyramid schemes, multi-level marketing and crypto-currency issuance. Among the current operations mentioned include Supermarketings Global Ltd, 3 friends System Group, One Coin and Kwakoo. The scams were found to often require new members/recruits to pay a fixed amount of money to the scheme’s promoters often guised as a membership fee with the promise to receive a portion of new entrants fees. The schemes often guise as product or service oriented and often have mandatory purchase of goods such as medicine or service such as travel or digital coins. Among the easiest ways to detect the fake schemes is a promise to make one rich in a short period with minimum effort. The bank said that such operations are illegal in the country and members stand to lose their money. In recent years, Pyramid schemes have taken multiple shapes and forms often guising as legit businesses. In September last year World Ventures, a firm that had been branding itself as a multi-level travel company has been deemed as a possible pyramid scheme by the government. Consequently, the government has warned that members of the public engaging with the firm are doing so at their own risk. In 2013, five companies operating under similar models were banned in the country for being Pyramid schemes. The firms included Diamond Holiday Travel Ltd, Twese Development Initiative Ltd, Ingaru Company Ltd, Aguka Development Ltd and Cooperative Abigize. editor@newtimesrwanda.com

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Central Bank warns public on pyramid schemes, crypto-currency scam